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The areas most at risk when interest rates rise


Savills has produced two maps that show which areas of the UK are most at risk when rates rise.

They are areas that are exposed to both high average loan-to-value and loan-to-income ratios.

While north England and Wales have higher average outstanding LTV mortgages, London and the South East have the highest average LTI ratios.

Savills has concluded that the likes of Newham, Crawley, Barking and Dagenham, Tower Hamlets, Harlow, Worcester, Watford, and Slough are most exposed to rate rises due to a combination of high LTVs and LTIs.

Conversely, the likes of West Somerset, Camden, Eden, Copeland, Richmondshire and North Norfolk where outstanding levels of debt are less exposed.

Savills UK head of residential research Lucian Cook says: “Loan-to-income ratios are more stretched in London despite the higher equity cushion. Consequently, the capital will be more constrained by the mortgage market review and increased interest rate rises. This will particularly affect younger owner occupiers, who are relatively new to the market and have stretched themselves on higher loan to incomes.

“On the other hand, some of the markets with the least equity are less affected by affordability constraints as they have lower loan-to-income multiples, but people’s ability to trade up the housing ladder may be limited by a lack of accumulated equity to put down as a deposit.”

The two heat maps below give the average LTVs and LTIs of UK regions:

Average LTVs:

Average LTIs:

Table showing mortgage debt breakdown, ordered by average outstanding mortgage


Region Outstanding owner occupied mortgage debt Average outstanding mortgage Average LTV for owner occupiers with a mortgage Average outstanding mortgage vs 2x average earner income
London £182bn £215,280 39% 2.99
South East £192bn £160,502 45% 2.56
East £111bn £139,692 47% 2.35
South West £79bn £114,503 45% 1.84
West Midlands £69bn £98,626 54% 2.01
East Midlands £60bn £95,748 54% 1.90
North West £88bn £92,153 57% 1.75
Scotland £68bn £88,843 57% 1.57
Yorkshire and the Humber £61bn £86,724 55% 1.75
Wales £33bn £84,241 55% 1.71
North East £28bn £79,534 60% 1.66

Source: Savills research



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